think I've made a boo boo HSBC

glitterygert

Hi I've just opened an online saver account with HSBC, and put £15000 in it, and don't really understand about the interest, it says AER 6.25%, Gross 6.08% and net 4.86%, will the interest payable be the gross, or the net amount, and how much would it be. There is a 14 day cooling off period should I look for something else, to give me a small monthly income?

Many thanks

Aegis

The default payment method is to withhold income tax of 20% from your interest. As such, you'll receive the net amount each year if you leave it in the account the whole time. If you divide that by 12, you will slightly under-estimate the monthly income because that avoids compounding, but it's a good ball-park figure.

Beate

And please remember that you will receive no interest whatsoever in a month you make a withdrawal with the HSBC Online Saver. This is not an account you should dip into all the time. If you want to be more flexible, open Bradford & Bingley's Internet Saver. It pays 6.4% AER and they don't penalise you for withdrawing money.

gt94sss2

Though its worth pointing out that if you want monthly income you can set your Online Saver account to automatically transfer your interest each month to another HSBC account - and this is not counted as a 'withdrawal' for interest rate purposes.

Regards
Sunil